Background of the case

On 7 November 2019, the plaintiff filed a lawsuit based on a trademark infringement action as well as unfair competition acts. Hereinafter, and as a response to the lawsuit, the defendant opposed in its entirety to all the claims and in addition, filed a counterclaim requesting the nullity of the trademark based on bat faith.

The disputed facts are the following: the defendant and counterclaimant acquired the domain name, being the plaintiff the owner of the trademark “TAXIS PALAMOS figurative”. The plaintiff claims damages pursuant to the infringement action provided in the Trademark Act and acts of unfair competition (acts of confusion, imitation, and unfair advantage of the reputation) for the unauthorized use of the terms TAXIS PALAMOS.

Decision of the Barcelona Commercial Court

Trademark infringement

Concerning the trademark infringement, the question at stake is whether the defendant uses the domain name in such a way as to infringe the registered trademark. It is considered that it does not for the following reasons: the word element of the registered trademark TAXIS PALAMOS lacks distinctive character (it is generic and common), the trademark incorporates a figurative element with greater preponderance than the word element which is the one that gives distinctiveness to the trademark. Therefore, when adding the term TAXIS PALAMOS in the search engine, this act does not infringe the plaintiff’s trademark. In this sense, it is noted that there are also several domain names with TAXI (descriptive of the services to be provided) and PALAMOS (place where the service is provided), but it cannot be considered that we are facing an infringement for all the domain names that incorporate these generic terms.

In short, since no other infringing acts have been alleged (use of the trademark with the logo), other than those alleged for the use of the domain name, the trademark infringement is dismissed.

Cancellation action based on bad faith

The requirements for bad faith to be considered at the time of the trademark application, as already defined by European case law, are: a) that the applicant knew or should have known that a third party was already using a sign confusingly similar to the one applied for (TAXIS PALAMO); b) the intention to prevent a third party from continuing to use the sign.

Based on these premises, this action is rejected as it is not proved the unfair intention of the plaintiff at the time of the application. Thus, the Judge states and understands that there is legitimate interest of the applicant to protect its trademark against third parties. By the mere fact of having included a graphic element (additional to TAXIS PALAMO), the judgement argues that the counterclaimant has gone beyond the signs/terms that already existed, in order to achieve a differentiation of all of them in the economic traffic, and therefore it is in accordance with a legitimate trademark protection.



Unfair competition actions

In this decision it is recalled which are the criteria and doctrine in force that led to apply the Spanish Unfair Competition Act when we are facing claims that can be merely qualified as trademark infringements already provided for in the special provision. That is to say, if both acts are applied at the same time, it will depend on the claim of the defendant and its factual basis, so that the provisions of such Act does not entail a systematic contradiction with the solutions that Trademark Act already covers, not being necessary to generate new exclusive rights or to sanction what is expressly admitted.

By virtue of this doctrine, it is therefore not possible to state that we are dealing with acts of unfair competition due to the use of the terms TAXI PALAMOS as a domain name.

The judgment only goes into the merits of the acts of imitation and taking advantage of the reputation and highlights that imitations of commercial services and initiatives are free unless they are protected by an exclusive right. In other words, freedom of imitation is proclaimed as a principle, unless the material creation or service is protected by the relevant exclusive rights.

As regards the assumption of the unfair advantage of the reputation, this act applies to the result (the exploitation itself through, for example, the profits obtained) and not to the action that produces it, which may be any, except for the imitation of the performance itself (where the act of imitation comes into play). It is indicated that it is not appropriate to go into further evaluation, since it has not been proven from the facts, that the mere use of the domain name with two generic concepts can justify these acts of unfair competition.

In short, both the complaint and the counterclaim are dismissed.

Judgment nº 20/2021 of the Commercial Court nº 2 of Barcelona dated February 9, 2021.